12 May 2016

Click Fraud will continue to thrive unless industry agrees

UK advertising is blighted by fraudsters generating false clicks that siphon-off hundreds of millions of pounds each year from the industry. However, law authorities are practically powerless to pursue such criminals unless the industry agrees to fund more effectively policing of the sector, according to leading voices in the industry.

Click fraud, or bot traffic, costs the UK online advertising business almost £300m each year, according to a report by Integral Ad Science, and is regularly cited as ‘the number one’ issue among brand-side marketers, but authorities here are under-equipped to pursue such fraudsters.

This is a situation that is likely to continue unless the industry is prepared to better fund units of the police dedicated to disrupting ‘bad actors’, similar to other industries, such as the financial sector, according to the IAB’s Steve Chester, speaking at the recent Brand Safety Summit, hosted by 614 Group.

“We first sat down with the police six months ago, and then again about two months ago to discuss what we could do in terms of what role they can play in terms of going after and arresting the fraudsters – for want of a better word,” he said, adding "we have to get serious about this".

International complexities in policing

He later went on to explain the complexities of policing the online sector. The international nature of criminals attracted to activities such as ad fraud is that a lot of operate "fronts" in the UK and US, but the actual perpetrators are based abroad. To catch such criminals abroad would involve cooperation with authorities from many different jurisdictions, according to Chester.

At present, the IAB plus the other trade bodies represented by is exploring the possibility of putting together a blacklist of websites, i.e. a list of website where advertisers won’t serve ads on, with PIPCU - the unit of law enforcement that polices copyright infringing websites in the UK.

The working theory is that PIPCU could then investigate companies and individuals identified on said blacklist and if need be arrest them, etc., (similar to how it deals with those breaking copyright law). Although, Chester went on to recite how the police were quick to highlight the shortcomings in terms of resource when it comes to law enforcement.

Lack of police resource

“The police then said: "It depends on what you want, and are willing to pay for.’” he said. “The long and the short of it is, there is no money for the police to make inroads to this.”

This is due to cuts in police force funding, which then limits the areas they are able to focus on, said Chester, who further explained that if the advertising industry wants further action taken against fraudster then an element of self-funding is necessary.

“They don’t have the money, but there is precedent in other industries such as the financial sector to fund the police in areas [to help them investigate against insurance fraud, etc.] where you have units of the police essentially funded by the industry, and that’s what we’re going to have to do.

“We’re going to have to get the industry to collectively and fund this thing. To make a blunt point: we as an industry will have to stump up a lot more money. At present we virtually put in nothing in terms of protecting this industry,” he warned attendees.

UK media industry is underinvesting in protection

A number of weeks about the IAB released figures demonstrating that the UK online advertising business was worth £8.6bn in 2015, but the industry here collectively contributed “less than six figures” to protect itself when it came to ad fraud, as well as brand safety and viewability, according to Chester.

He later pointed out that in the US the Trustworthy Accountability Group (TAG) invests proportionality more into protecting itself.

“We’re going to have to get to the point where we take this super-seriously… and think about something similar in the UK, and rather than saying: 'this is too hard, and the processes are in place',” he said.

“If we can produce the money, and the impetus, then the will is certainly there (We just need money). Then the police can get involved, and we can determine what role they play. This could involve them knocking on people’s doors, and stopping them.”

In the meantime, the very best the industry can hope for is to put together blacklists, but this is more-or-less ineffective without law authorities having the resource to investigate and pursue perpetrators, as they are likely to then ‘pivot’, and devise more complex ways of disguising their operations. Quite simply, without funding “you won’t get to them”, said Chester.

Pan-industry cooperation through JICWEB

The online advertising business collectively works with PIPCU via way of JICWEB – a pan-industry trade body representing the IAB, plus other trade bodies representing publishers, marketers and media agencies.

JICWEB chairman Richard Foan, recounted the industry’s early efforts to collectively tackle ad fraud involving issuing guidance, devising a common taxonomy, plus a (soon-to-be published) set of principles on best-practice.

Although he did add: “We need to put commensurate resource into dealing with the fraudsters… underneath it all there are things that need to be sorted out, this is well acknowledged.”

Meanwhile, Julia Smith, a partner at 614 Group, and director of communications at Forensiq, echoed Chester’s earlier claims that the appetite to tackle the problem is there, but resource is lacking.

“There are certain ways we could think about funding such a move better, but we’d have to come together to talk about it, but we definitely have to fund it ourselves [as an industry]. If we look at how we tackle ads on pirate sites, the same rules apply. If there is no advertising there is no revenue for the sites and they close..”

When quizzed on which tiers of the business would be best placed to address the issue, she said a lot of the open marketplaces such as online ad exchanges would be key areas to focus upon, as well as demand-side platforms.

“Those sources where there is a lot of ‘supply’, and ‘demand’, should be able to root out quite a lot,” she said.”